Tesla's annual sales fall for first time in nine years

By: Shawn
Tesla's global sales increased 2.3% in the fourth quarter, following a slow start to the year that resulted in the electric vehicle company's first year-over-year sales loss since 2015.

The Austin, Texas-based company's yearly drop occurred despite offerings like as 0% financing, free charging, and low-cost leasing.

Tesla CEO 'Elon Musk.'
Andrew Harnik/Getty Images

Tesla delivered 495,570 vehicles from October to December, bringing total deliveries to 1.79 million for the year. However, this was 1.1% lower than projected sales of 1.81 million in 2023, since general demand for electric vehicles in the United States and worldwide fell.

The fourth-quarter surge comes at a cost. Analysts surveyed by FactSet predicted Tesla's average sales price to decrease to just over $41,000 in the quarter, the lowest in four years.

That does not bode well for Tesla's fourth-quarter profits, which the company announced it will report on January 29.

Tesla expected that its sales will climb by 50% in most years by 2022, however this prognosis was met with an older model portfolio and rising competition in China, Europe, and the United States. According to researchers, the majority of early adopters of technology in the United States already own electric vehicles, but more mainstream consumers are concerned about range, pricing, and the ability to find charging stations for longer excursions.

Fourth-quarter deliveries fell short of Wall Street expectations. FactSet surveyed analysts, who projected 498,000 vehicle sales.

Tesla shares dipped 5.2% in early trading Thursday, although they are up more than 50% in the previous year, boosted by Donald Trump's election triumph.

Falling sales early this year resulted in previously unheard-of discounts for the automaker, reducing its industry-leading profit margins.

Legacy and upstart automakers are also increasing their competition as they seek to reduce the company's market share.

Tesla's sales were almost entirely driven by the smaller and less priced Models 3 and Y, with the firm selling only 23,640 of its more premium models, which included the X and S, as well as the new Cybertruck.

Tesla's worldwide electric vehicle sales beat out Chinese rival BYD, which revealed on Thursday that overall sales increased 41% last year, including 1.77 million EVs. The firm is competing with Tesla to be the world's best-selling electric vehicle manufacturer.

The fourth quarter's output of 459,445 vehicles was lower than total deliveries, while the whole year's production of 1.77 million was lower than sales.

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